I intend to invest in crypto currency for the long term (2 years at least). I came up with a 5-stage model that I am planning to use to evaluate any crypto currency (ICO or traded) and decide whether I should invest in it or not. Please help me by telling me what you think.

Stage 1: Bussiness Model

The first thing I would do is to check if the crypto currency has a sound business model. A business model is a plan for the successful operation of a business, identifying sources of revenue, the intended customer base, products, and details of financing. So, I would look for answers to the following questions:

1- What is its business model? What does it do? How does it do it?

2- What is the size of the market it wants to penetrate?

3- Is there a special problem in that market that this project is going to solve? Is the solution proposed a good one?

4- How would the company behind the project benefit from it? What is the profit source for them? If they don't profit from it, they will not continue developing and supporting it. On the other hand, if they are planning to take all the profit, then it is not a good investment.

5- How are they planning to implement their project? What is the road map (plan) to achieve that? Is it suitable? Is it possible? Is the time allocation reasonable?

6- What is their financing source?

Stage 2: The Token

If the project itself is a good one, that does not mean, the token is a good investment. Remember, the token is not necessarily a share in the company. So, I would need to check if the token's price is expected to go high by time. I would do that by finding answers to the following questions:

1- What is the role of the token in the network? Is it a share? Is it fuel? Is it money?

2- Why would the price of the token increase? Is the system designed in such a way to create high demand for it?

3- How easy is it to trade, transfer and store the token? Is it traded on exchanges? Can I store it on my own device? Does it cost a lot to transfer it?

4- What is the inflation rate? How is it inflated? Do the new tokens generate value?

Stage 3: The Technology

The project might have a sound business model, but the technology it is using is inferior. Therefore, I must check the following:

1- What is the technology behind the project?

2- What is the consensus system it is using? Has it been tested? How good is it?

3- What mining or minting algorithm is it going to use? How will it attract miners or minters?

4- How fast is it?

5- Is it scalable?

6- How secure is it?

7- Is it open source?

Stage 4: The Team

A good team is very important for the success of any project. That's why I should check the following:

1- Who is the team behind the project?

2- Is the team big enough? If the number of developers is small, it would take too long to develop and deliver.

3- Can anyone help, or is it limited to a specific group?

4- How good is the team? Are they specialists in their fields? Do they have experience?

5- Do they have a business development team? marketing and PR team? UI and UX team? Or they are only focused on the core tech?

6- What is their history? How well are they connected? Does the community respect and trust them?

7- What is their track record? Were they able to deliver results and achieve goals in the past?

Stage 5: Is it just an Idea?

There are many coins with so many big promises. But there is a long way between promises and achievements. Therefore, I must check for real achievement :

1- Do they have a good white paper?

2- Do they have a good website?

3- Do they have a public network? Is it stable? How many nodes does it have?

4- Do they have a good running wallet? Which platforms does it support?

5- Do they have a running product? How good is it? Is it still beta or is it stable?

6- How long have they been working?

7- Do they have real customers paying real money? How many? This is especially important.

Stage 6: Community and Adoption

This is very important. Many projects are open source, and you can easily copy/fork them. But you can not copy community support or adoption. This is what makes Bitcoin the king of the crypto jungle. So, I should look for the following:

1- How big is the community supporting the project?

2- How active is it? What are the available channels of communication? How active are they?

3- Are the marketing for the project good enough?

4- Was it able to attract many miners/minters/witnesses?

5- How good is the adoption of the project? Did it reach non-technical people? Main stream?

So, what do you think? Do you have any suggestion or Idea? Please leave a comment.